Economic Effects of Retail Shoplifting

Shoplifting has a number of effects on the economy.

Retailers have a wide array of issues and problems they have to deal with on a daily basis, and retail shoplifting is one of the most serious of these. The costs of retail shoplifting are considerable; the website evancarmichael.com estimates that most retail businesses will lose between 1 and 8 percent of their yearly gross sales to shoplifting. However, shoplifting also has some positive economic effects.

Cost of Goods

The first effect that shoplifting has on the overall economy is that it helps increase the cost of goods. This is in part because the goods that are being stolen have to be replaced on the shelves so that real customers will have them to buy. And, in addition to the product itself, additional costs are involved in shipping the replacements, stocking them and shelving them.

Cost of Security Measures

Another effect that shoplifting has on the economy is that retailers are forced to spend considerable sums of money on anti-theft security measures and equipment. This includes more personnel, door security scanners, video monitoring equipment and so on. All of these devices are very expensive and thus have an effect on a store's bottom line.

Cost of Legal Proceedings

When shoplifters are caught, the store often finds it necessary to have employees attend court proceedings about the case. These security personnel are often required to present testimony as well as physical proof, such as videotapes taken in the store. In addition, the government has to spend money on the prosecution.

Boost for Employment

The other side of the coin when it comes to the effect of shoplifting on the economy is that it does in fact create jobs. The need to prevent shoplifting or to catch the culprits necessitates the hiring of security experts to design store security, store personnel to act as security and the purchase of a great deal of sophisticated and expensive equipment that has to be made by workers.

References

• Evan Carmichael: Calculate the Cost of Shoplifting and Employee Theft; Fred Tarasoff